Guiding your life’s biggest financial moments

Personal Finance

The wrong way to get rich

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“Mr. Beaver, I’m finally starting to make real money in my medical practice, but I don’t know the first thing to invest. I need concrete advice on money management, wealth building , but I don’t want to become a slave to money.

“I have met financial advisers, but I don’t understand the terms they use and frankly I’m afraid to sound stupid, so I don’t ask them to explain me. Do you know of a book that is aimed at people like me, who need basic personal finance training, but which also has a “human” touch? Thanks, Karl.

I just finished reading the answer to what Karl is looking for. It is Your Total Wealth: The Heart and Soul of Financial Literacy, by former university business professors Lyle Sussman, Ph.D. and David Dubofsky, Ph.D., CFA.

For anyone new to life, Your total wealth is the ideal read. It is the most unique and accessible financial advice resource I have ever seen and goes far beyond how to make money.

The authors give us a window into what “total wealth” means, how to get there, and show that it is more than just numbers. Total wealth is greater than the “stuff” we own or the balance in an investment account.

I wish I had had this book years ago, or as I tell my friends, “When I had hair.”

Your total wealth has a feature that I have never seen before. The pages on the left provide definitions, such as margin, short selling, average dollar costs, leverage – terms most people don’t understand, with examples. The right-hand pages give readers a life lesson related to the term just defined. Here is an example from the book:

Annuity: A financial annuity is a predictable stream of payment, like a retirement annuity offered by insurance companies, designed to pay for as long as you live.

The lesson of life: a emotional annuity is a predictable human bond of benevolence, commitment and concern. He said, “I’m here for you. The next time you see an elderly couple walking down the street with a smile on their faces, holding hands, you are witnessing an emotional annuity being paid.

When adult children take care of aging parents, these children pay an emotional pension.

Your total wealth is filled with ideas like this, financial terms, and life lessons that make you think of a richer life.

I asked the authors to discuss some of the things people do in the pursuit of financial wealth that lead to disappointment and failure in life.

Sussman: Not understanding the cost of obsessive focus on monetary richness.

Consequences: Think of the tactile dish of Midas. If you are consumed with money and greed, realize the cost you will pay. You lose family, self-esteem, happiness. These things often become unintended consequences of acquiring financial wealth.

Yes, we need money to live comfortably, but studies show that when our basic needs are met, more income does not mean more happiness. I have met millionaires who admit to having missed something despite their great monetary wealth.

Dubofsky: Not being happy in your job and constantly looking for better paying jobs.

Consequences: You will pray for Fridays and hate Mondays! Very wealthy people understand that they need to actively earn money so that they don’t lose the things they love, their friends and family. If you work madly just to pay a bill, another will be due later in life.

It is the one that asks, “Have you achieved a balance between acquiring financial wealth and personal growth?” Have you woken up every day happy to go to work ”?

It is the lucky person who realizes early in life what results from being devoted solely to income. They have the wisdom to look to the future when they are older. And they ask, “What will my inheritance be?

Sussman: Using credit for bad purposes. Borrow money to go on an expensive vacation. Buy something unnecessary that you cannot afford.

Consequences: You will give up future financial security. Borrowing money for a house is a good use of credit, but not for an unaffordable vacation. Renting a car is fine, but don’t go overboard and rent something way beyond your means just to look like you’re doing it. There are a lot of people who “succeed” in bankruptcy court.

After reading the book, I can see that it has a lot of great tips that can help many types of people. Your total wealth is about life and how money is used to improve our lives and the lives of those who are dear to us. Giving a copy to young and new clients would be a great way for a financial advisor to start a professional relationship.

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